Audio 4:15
Qld Govt shuns calls for more details about gas exports

Stephanie SmailUpdated
Thu Apr 24 14:55:00 EST 2014

Looming gas price hikes in New South Wales have prompted calls for more transparency around gas export deals. The New South Wales Government wants to know how much gas has been promised to overseas buyers, but the Queensland Government has shunned the idea.

Transcript

ELIZABETH JACKSON: A proposal by the New South Wales pricing regulator to boost gas prices by as much as $225 a year to some households is prompting calls for more transparency around gas export deals.

Australia will triple its gas production in the next few years as key gas projects in Queensland ramp up production.

But most of the new gas generated will be exported to Asia.

As Stephanie Smail reports, there are calls to reveal exactly how much gas has been promised to overseas buyers so that the domestic market can plan for the future.

STEPHANIE SMAIL: With price hikes looming, the New South Wales Government wants details about how much of Australia's gas will be shipped offshore.

The New South Wales Energy Minister Anthony* Roberts says governments have the right to know whether or not domestic needs will be met.

He wants companies to share information about the long-term supply contracts in place for Queensland's LNG (liquefied natural gas) industry.

MARK MCARDLE: We need to locate the gas, we need to incentivise the corporations, we need to work on a state level and with the federal level as well via Ian Macfarlane to get gas into the market.

Once supply and demand come into alignment, we will find a solution to the problem but I don't think simply making statements such as we want to know what gas is going overseas will solve the problem.

The problem will be solved here by the states working together and states recognising that they need to work within their own boundaries to get more gas into the field.

STEPHANIE SMAIL: He's blaming New South Wales for stunting the growth of the gas industry along the eastern seaboard.

MARK MCARDLE: The significant increase in gas prices in New South Wales is in large measure to the fact that New South Wales are not allowing appropriate exploration and development of gas industries. That's impacting upon New South Wales and could well impact upon Queensland as well.

Going back a number of years, in the early days, the interaction between the gas corporations and also the land owners were not strong, nor were they good but Queensland acknowledged that and put in place the Gas Commission and the gas fields commissioner.

That individual and that body are working very hard to get cooperation between the two entities to get a long term benefit here in Queensland. New South Wales needs to move with the times.

STEPHANIE SMAIL: Anthony* Roberts also wants to know if there are provisions in the gas export contracts that will mean suppliers could be fined if they don't meet export quotas.

Mark McArdle says that's an unrealistic expectation.

MARK MCARDLE: Look, I think at the end of the day we have to recognise that these corporations are private corporations that have spent billions of dollars here in Queensland, in Curtis Island and the rest of Queensland, between $60 and $70 billion have been invested by this corporations in production, in exploration and other associated areas in regard to gas.

I don't believe they need to divulge those details. It's commercial in confidence. What we need to do is to get the states lined up to understand that the state governments in each state are part of the solution and governments such as New South Wales need to realise they are part of the problem.

STEPHANIE SMAIL: He says state and federal governments can plan for the domestic gas market without more information about export plans.

MARK MCARDLE: If we don't look at it and plan for it we've failed already. If you aren't playing in the field of what's going to happen in four, five, 10, 15 years time, you've already failed and understanding the problems and dealing with those problems now is part of the solution for long term benefit.

STEPHANIE SMAIL: How can you plan properly if you don't know all the information about how much gas you will or won't have?

MARK MCARDLE: Well, I think the idea is that there is exploration going on right across the state as we talk at this point in time. There are great reserves, I've been advised, that other gas resources in Queensland and indeed right across Australia.

We need to start looking at this with open eyes and understanding what both international and domestic markets are going to look like in five or 10 years time and look what the corporations and governments of all levels can do to access that gas to provide for international and domestic markets.